Cisco Collaboration Summit and Q1 Earnings - is Their Mojo Back?

It's a tricky question, and I know some people would love to say YES and some would love to say NO.

I'm leaning towards yes, but this is no slam dunk, especially if you're an investor. I attended their annual Collaboration Summit a couple of weeks back in Boca Raton - what's not to like? - and Cisco had their Q1 earnings call last week. I felt badly because I didn't get a chance to blog about the summit, but the stars have lined up for now, and I found that after the Q1 earnings call, there was actually a better story to tell.

That's what I've done for this month's contribution to the UCStrategies portal. Whether you're inside or outside the Cisco tent, I think you'll find this is a good read, and would love to know if you think they've got their mojo back.

Cisco Cius - Impressive Demo - But Will the Market Buy?

Been too busy to post about this til now, and hopefully, there's still an appetite to hear more about the launch of Cisco's Cius tablet on Wednesday. I say "hopefully", not just because I don't move in Internet time and am not big on instant analysis, but also because so much of what I've seen out there is just descriptive rehashing of what Cius does - not what it is or what it means. I can't believe how lazy people are, just endlessly re-tweeting this type of coverage - and surely I hope you don't view Twitter as the final word as an authoritative source. I'll save that one for another day.

I'll start off by saying this is the warm-up post. I'm just going to recap a few key takeaways, which I'll flesh out further in my next UCStrategies writeup - look for that early next week. I attended a hands-on demo of Cius on Wednesday at Cisco's Canadian headquarters here in Toronto, so I can actually say I have a first-hand account of the product as well as the benefit of the in-depth presentations onsite as well as via telepresence.

Before sharing some thoughts, you may know that the Cius story is a year in the making. Cius was announced at last year's C-Scape (and I'll be there this year in about 10 days), and I wrote up my impressions shortly after for the UCStrategies portal.

A lot has happened since the announcement last July, and in this case, I think it plays into Cisco's favor. The tablet market has exploded since then, and while the iPad is still the "it" device for consumers, we've since seen Flare and more recently, the PlayBook for the business market. I'm sure Cisco has learned from those launches, and following their hasty exit from the consumer video space with Flip, their go-to-market with Cius has become pretty focused.

Cisco's GTM for Cius isn't bullet proof, but I think it makes for a strong entry given how fast this market is growing. Nobody has a solid value proposition yet for the business market with tablets, which is still very much an early adopter space. The Cius demo only confirmed my belief that while this bright, shiny object has undeniable sex appeal, both vendors and end users don't really know what it or how to integrate it with everything else they're already using. The last thing we want is another gadget to carry around, and it's too early to tell if Cius will displace other end points, or simply add to the mix.

Regardless, I believe Cisco is in a truly unique position to make tablets a success in the business market, but a lot of things have to go right, and of course, businesses need to see a reason to buy. With so many employees using iPads for fun, it's going to be interesting to see how they drive adoption.

Most techhy types that I know routinely carry an iPhone and a BlackBerry - it's pretty clear that an iPhone just doesn't cut it for business. I could see the same thing happening here with tablets - where are people going to put all these gadgets? Restaurant tables are going to get very crowded now when people meet, and do their usual power moves to lay out all their devices so they don't miss a call, or a sports score, or a tweet, or whatever.

Can you picture that? Two guys meet for lunch, and out come the phones and the tablets. Two guys and eight gadgets on the table - as you know, men can't project power if they keep these things in their pockets. I don't know what women are going to do! This is getting silly, but that's exactly what's going to happen - let's move on.

I'll explore more about what I think Cisco has done right in my UCS post next week, as well as what all this might mean for the Unified Communications space. Until then, here are a couple of photos from the demo, and if you made it this far, I think you'll enjoy my post next week.

For those of you up here in sunny, warm Canada (is that an oxymoron?), happy Canada Day! And for my expats south of us, Happy 4th!

Cisco Takeaways: Five Ways to Rethink Communications

I've been writing a fair bit about last week's Cisco Collaboration Summit, but that's because there's a lot to talk about. This time, I've channeled some new thoughts into my latest Focus Brief. The idea here is to summarize five themes that I believe business decision-makers need think more critically about, and for you to mull over during the Thanksgiving break.

Cisco is looking to play an even bigger role than most of you can imagine for our workplace needs, and if their plans come to fruition, these themes will become core drivers for communications planning at all levels. To follow my thinking, you can read my brief on now, and then let me know if I'm on target or not.

UCStrategies Podcast - Cisco, Microsoft and HP

Last week sure was busy in the IP comms space, and while a few of us were busy at Cisco's Collaboration Summit, others were busy following news from Microsoft and HP. I've shared a few things about Cisco's event already, with one more coming today.

I can now add this podcast to the list of analysis and commentary. This was our weekly group call with UCStrategies analysts, and we reviewed our thoughts about the summit along with these other major news events. The podcast can be downloaded here, and there's a transcript if you'd rather just read along.

Cisco FY 2011 Analyst Update

As Cisco's universe keeps expanding, we all have to work a little harder to keep pace. One of the many things Cisco does very well is host sessions to update the analyst community, and probably more than any other company, they truly walk the walk. As with all vendors, they have near overkill on webinar and phone briefings - wouldn't you, if you spent $3 billion on WebEx? They do plenty of live events - which are always great - and with the magic of another expensive technology - telepresence - we get our share of virtual events.

Today was the virtual variety, and I was one of only two analysts in Canada who got the telepresence treatment at Cisco's Canadian HQ here in downtown Toronto. I've done a few of these, and it's always a good experience. The meeting synched up 5 locations - Toronto, San Jose, London and a couple of sites in the Boston area. They're getting pretty good at this, and the session definitely feels immersive and life-like.

The session itself was led by Frank Calderoni, EVP/CFO, and he did a pretty good walkthrough of Cisco's overall plans and growth expectations. Some of this was familiar from what I saw at C-Scape this summer, but quite a bit was new. He spent a fair bit of time reviewing their VSE mantra - these are the principles that drive the company - Vision, Strategy and Execution. It all makes sense, and is built squarely around the notion that the network is everything - it's the platform that "enables new business models and organizational structures". Fair enough. Every company has its culture and guiding lights, and it's very clear from this what makes Cisco go.

They layered a few other things on this, namely DNO and CPAD. This is first nature if you work for Cisco, and I guess it will become second nature to us if we stay with the program. If you must know, DNO is Dynamic Networked Organization, and CPAD is Cisco Priority Assessment Dashboard. We didn't have acronyms like this during my MBA days - but we didn't have computers either (there really was a time like this!). I'm sure if I did a re-fresh, these would be the kinds of best practices concepts that we'd be learning about.

Back to why we're really here. So, as we heard at C-Scape, Cisco has become an innovation machine, and the 400+ new products over the past year is impressive by any standard. They also have $40 billion in cash, so there's nothing they can't buy if the mood struck. Not surprisingly, they're now moving to issue a dividend - that idle cash isn't exactly earning much interest and shareholders need to be kept happy.

Looking forward, the main message is the growth outlook. They expect a 12 - 17% annual growth rate over the next 3-5 years, and Frank did a good job breaking that down. Most of this will come from overall market growth, and the rest will come from three main places. First will be growth from increased share of wallet they gain from customers as their product mix expands. Second will be growth from emerging countries, which are on a different trajectory than the developed world. Finally, there will be some growth from what they call "market adjacencies" - these are new spaces/verticals that Cisco is growing into, such as healthcare and smart grid. All told, it's a pretty reasonable picture, and if they can sustain this level, it will be a real testament not just to what they sell to their customers, but more impressively, how the company itself operates and executes on its plans. When you look at how many sectors and companies in the U.S. are poorly run (with some getting bailouts), Cisco is in many ways a great model for doing things right. That really was the main takeaway for me.

To be fair, of course, we all know that a lot of Cisco's forays into new spaces is by design, and steps on a lot of toes. Traditional partners are now becoming competitors, and there's more of an us-or-them climate out there than in the past. That's not really Cisco's problem, as they simply need to find new growth opportunities to get beyond the core router/switching business that they've done such a great job saturating. While this core accounts for 50% of their business today, Frank explained how they see the other areas accounting for most of the future growth. Right now, all these areas fall under the "Advanced Technologies" bucket, which today is 24% of sales. This includes pretty much everything that isn't routers or switches - telepresence, video, data centers, mobility, etc. They're betting pretty heavily on these markets - and I would be too.

There's a lot to keep on top of here, and I'm glad I attended this update. This is one of those companies that you can fall behind on in a big way if you stop following them, especially since they are so global now. For better or worse, they're too big to ignore, but they're doing right by me in terms of keeping us in the loop.